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Regulations on Investment Vehicles in Singapore

Regulations on Investment Vehicles in Singapore

Singapore is currently one of the world’s most reputable financial centers and many times it is placed next to New York and London thanks to the financial services it offers. This also encompasses the fintech and investment funds sectors of the financial industry which have determined a great number of foreign investors to set up funds here.

In order to establish an investment fund, one will need a structure through which the fund will be marketed or administered in Singapore. This structure is usually known as an investment vehicle. Even if the Singapore legislation provides for various types of investment vehicles, the Monetary Authority (MAS) launched a new type of structure at the beginning of 2017: the Singapore – Variable Capital Company (S-VACC).

Our Singapore company formation advisors can offer information on the regulations related to investment vehicles in the city-state.

Types of investment vehicles available in Singapore

Apart from the S-VACC, foreign investors may set up funds and use other types of investment vehicles in Singapore. The most employed ones are:

  • – the unit trust which can be used to market open-ended retail funds;
  • – public and private limited liability companies can also be used as investment vehicles in Singapore;
  • – limited partnerships can be used for any type of investment fund.

Our company registration experts in Singapore can assist with the registration of investment vehicles in the city-state.

Requirements related to investment funds when opening a fund in Singapore

Even if registering an investment vehicle equals company formation in Singapore, the structure used must comply with certain regulations imposed by the MAS. First of all, the manager of the Singapore investment company must hold a capital market service (CMS) license. The vehicle must also undergo authorization with the MAS based on a prospectus. Another regulation imposed to investment vehicles is that their managers can administer up to 250 million SGD for a maximum number of 30 qualified investors.

It is useful to know that the Singapore Monetary Authority has also enabled a scheme for investment vehicles used for administering funds: a 10% concessionary income tax which is granted under the Financial Sector Incentive program.

For full information on the regulations imposed to investment vehicles, please feel free to contact our Singapore company formation representatives.